[opendtv] Is Bert a "Cord Never?"
- From: Craig Birkmaier <craig@xxxxxxxxx>
- To: OpenDTV Mail List <opendtv@xxxxxxxxxxxxx>
- Date: Sun, 5 Aug 2012 15:33:27 -0400
Perhaps Bert is a trend setter...
;-)
What is more interesting is the apparent hole in the dike - people
giving out their password for cable subscriptions to "cord nevers,"
so they can access the "good stuff" online.
Wonder how the duo-oliogopoly is going to deal with this problem...
Regards
Craig
Forget Cord-Cutters: Cable Companies Should Worry About Cord-Nevers
AUG 3, 2012
Recent cord cutting numbers of about 400,000 last quarter might not
prove a threatening trend, but that's not the number that matters.
Looking at the various earnings reports of the cable
and satellite companies, Reuters' Yinka Adegokes found that around
400,000 people stopped paying for television. Those numbers might
sound a little ominous, but actually don't amount to anything scary,
as AllThingsD's Peter Kafka points out. He puts the estimated net
loss at a higher 425,000 thousand for the quarter. But that evens out
with the 422,000 subscribers the industry added last quarter. "They
still ended up adding more than 200,000 subscribers by the end of
2011.
That's barely any growth at all - something like 0.2 percent - but
it's better than a loss," he writes. That matches similar trends we
found the other day: Flat cable growth. So the cable industry
shouldn't worry then, right? Not exactly. These reports don't (and
can't) include the people who never had cable in the first place:
Call them the cord-nevers.
Cord-never numbers are particularly hard to measure. A cable company,
of course, can't report the amount of people who never subscribed to
them in the first place, but we can do some piecing together to get
an idea of the changing trends. U.S. census data found that 1.8
million new households were formed, but that only 16.9 percent of
those signed up for pay-TV services, according to Ad Age's Dan
Hirschorn. The TV industry has been flat for years; U.S. households
continue to rise. Meanwhile, as cable subscription rates have stayed
flat, Internet subscriptions are on the rise. Comcast added 156,000
net broadband subscribers, an 8.4% increase; Time Warner added 59,000
residential high-speed Internet subscribers. While something like 100
million U.S. households subscribe to TV services, the U.S. 2010
census data had 120 million households with Internet -- those numbers
have only risen since then, with these companies reporting increased
subscriptions. And what do people do on the Internet? Watch things.
Though the most popular Internet activity, as of 2010, was social
networking, video saw a 12 percent increase, according to a Neilsen
report. Though, those numbers include people with cable.
These cord-never numbers matter more than the cable-cutters because
the people who tend to not ever sign up for cable are young -- and
the youth is the future. Americans ages 12 to 34 are spending less
time in front of the TV, found another Neilsen study. As of February
2012, for three quarters in a row, there have been declines in
viewing among Americans under 35, The New York Times' Brian
Stelter reports. He attributes this decline to a shift to streaming.
"Young people are still watching the same shows, but they are
streaming them on computers and phones," he writes.
Right now the cable industry has maintained stable subscription rates
because of an elderly population that's watching television more,
adds Stelter. But, those people won't be around to change the future.
The broke twenty-somethings who survive off of Hulu, Netflix, bootleg
streams of their favorite shows, and stealing each others' HBO
Go passwords now, might get used to a life without paying for cable,
causing a generational shift in the way Americans consume things.
That's what the cable companies should worry about .
Want to add to this story? Let us know in comments or send an email
to the author at rgreenfield@xxxxxxxxxxxxxxxx You can share ideas for
stories on the Open Wire.
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